MAY 19, 2008

NEW ORLEANS – Imagine being able to combine Web 2.0 [1]** concepts like social networking [2]**, blogs [3]**, and wikis [4]**
with IP voice and multimedia over any IP broadband connection. Now
imagine service providers being able to offer these services to their
subscribers by simply adding a single software solution to their
network. It's all possible with new application software from Nortel*
[NYSE/TSX: NT [5]]
that makes it easy for service providers to deliver IP voice and
multimedia services with Web 2.0 – a combination known as
next-generation network (NGN) 2.0 – without costly and complex network
upgrades.

Nortel's new Adaptive Application Engine software, unveiled today at The Cable Show [6]**
in New Orleans (Booth 3105), is a major evolutionary step forward for
Nortel's SIP applications portfolio that brings together services
across wireless broadband, wireline and cable access networks in ways
that help service providers simplify their networks and enhance the
communication experience for subscribers. Here are some examples of
advanced service offerings to consumer and business customers made
possible with the Adaptive Application Engine software:

• Unified Communications [7] –
  By bringing together email, voicemail, instant messaging (IM), text,
  graphics, video files and web collaboration to the devices and
  productivity tools people use everyday, users have access to a more
  effective, more efficient communication experience. Imagine joining a
  video conference with everyone on the To: list of an email just by
  clicking a link in the message.

   

• Federated Instant
  Messaging – By uniting existing communication systems and tools, users
  can take advantage of federation, a protocol that allows you to talk to
  anyone, on any IM service regardless of provider so you can add friends
  using third-party IM applications to the Nortel PC Client.

   

• IP
  Communications over Web Applications – By creating
  communications-enabled applications and integrating them into social
  networking activities, users can include a "click-to-call-me" link from
  their Facebook [8]** pages connecting their friends to any wireline or wireless device to complete the call.

   

• VoIP
  over IPTV Integration – By controlling calls and having access to a
  variety of multimedia services through their TVs, viewers can use a TV
  remote to send an IM to a friend, easily place calls or transfer
  incoming calls to voicemail or a mobile phone.

   

• Fixed Mobile Convergence (FMC) [9] Services
  – By eliminating the boundary between location and device, users can
  gain new flexibility like transforming mobile phones into office
  extensions. For example, mobile workers can use their cell phones to
  access the corporate network and have the same voice calling features
  as their desk phones, like one business phone number, conferencing and
  call forwarding. Users can also "grab" a mobile call from their desktop
  or vice versa.

The Adaptive Application Engine software
is specially designed to adapt to the needs of service providers of
every segment, allowing a single solution to provide advanced
communication services to as few as hundreds, or easily scale up to
millions of subscribers. Operators can choose to run the software on
hundreds of Red Hat [10]**
Enterprise Linux compliant servers allowing them to select the hardware
that best suits their needs and budget. To accelerate development time
of new services, the Adaptive Application Engine software provides an
open programmability environment and web service Application Program
Interfaces (API's), which allow third-party software developers to
easily develop new applications which use call routing, presence and
federated IM.

"Nortel's depth of technology expertise across
carrier and enterprise sectors, wireless and wireline with focus on
both infrastructure and the application space allowed us to design
advanced SIP application software that can support the needs of any
service provider – large or small, traditional telco or integrated
communications enabled internet provider" said John McCready, general
manager, Carrier Multimedia Networks, Nortel. "Without increasing
network complexity, Nortel's Adaptive Application Engine software makes
it simple for any service provider to grow to support large increases
in demand for NGN 2.0 services. From an implementation perspective,
Nortel has the expertise to execute on this vision."

The
Adaptive Application Engine software can be deployed as a SIP
Application Server, as an IMS application server or as advanced
capabilities on the Communication Server (CS) 2000 [11]. For carrier customers who have already deployed the Nortel's CS 2000 or Application Server (AS) 5200 [12],
the Adaptive Application Engine software allows them to build on their
existing investment by adding new software capabilities which provide
NGN 2.0 capabilities while also supporting a significant increase in
capacity. The Adaptive Application Engine software will enhance the recently announced IP Powered Home (IPPH) Solutions [13] – innovative application bundles for the consumer market – and Nortel's IP Powered Business (IPPB) Solutions [14], pre-tested IP solutions for the small and medium sized business (SMB) market.

According to Dell'Oro Group, Nortel is the worldwide leader in carrier VoIP [15] and
has maintained that position for the last six years (2002-2007). Nortel
has shipped 88 million carrier IP voice and multimedia ports to over
250 carriers globally and Nortel's IMS-ready solutions have been
adopted by over 150 customers, including carriers operating across
wireline, wireless and cable domains. The standalone Adaptive
Application Engine software is expected to be available globally in
late 2008 and the CS 2000 version is expected to be available early
2009. For more information on the Adaptive Application Engine software,
check out the Nortel podcast [16] on the solution.

About Nortel

Nortel
is a recognized leader in delivering communications capabilities that
make the promise of Business Made Simple a reality for our customers.
Our next-generation technologies, for both service provider and
enterprise networks, support multimedia and business-critical
applications. Nortel's technologies are designed to help eliminate
today's barriers to efficiency, speed and performance by simplifying
networks and connecting people to the information they need, when they
need it. Nortel does business in more than 150 countries around the
world. For more information, visit Nortel on the Web at www.nortel.com [17]. For the latest Nortel news, visit www.nortel.com/news [18].

Certain
statements in this press release may contain words such as "could",
"expects", "may", "anticipates", "believes", "intends", "estimates",
"targets", "envisions", "seeks" and other similar language and are
considered forward-looking statements or information under applicable
securities legislation. These statements are based on Nortel's current
expectations, estimates, forecasts and projections about the operating
environment, economies and markets in which Nortel operates. These
statements are subject to important assumptions, risks and
uncertainties, which are difficult to predict and the actual outcome
may be materially different from those contemplated in forward-looking
statements. For additional information with respect to certain of these
and other factors, see Nortel's Annual Report on Form10-K, Quarterly
Reports on Form 10-Q and other securities filings with the SEC. Unless
otherwise required by applicable securities laws, Nortel disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise.

*Nortel, the Nortel logo and the Globemark are trademarks of Nortel Networks.
**This is a 3rd party link as described in our Web linking practices.
Red Hat is a registered trademark of Red Hat, Inc. in the U.S and other countries. Used under license.